Self-Regulatory Organizations; International Securities Exchange, LLC; Order Granting Approval of Proposed Rule Change, as Modified by Amendment No. 2, Regarding the Short-Term Option Series Program, 36848-36849 [2014-15199]
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36848
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Notices
short position, subtract the closing price
from the sale price. In the case of a long
position, subtract the purchase price
from the closing price.
A dataset of market orders and
marketable limit orders in a pipe
delimited format with field names as the
first record.
1. Minimum fields: Ticker symbol,
date, order receipt time, order type,
order size in shares, order side (‘‘B’’,
‘‘S’’, or ‘‘SS’’), order price (if marketable
limit), NB quoted price, NB quoted
depth in lots, receiving market offer for
buy or bid for sell, receiving market
depth (offer for buy and bid for sell),
indicator for quote leader, average
execution price (share-weighted),
executed shares, canceled shares, routed
shares, routed average execution price
(share-weighted), indicator for special
handling instructions.
2. Quote variables:
(a) NB quoted price is the national
best offer for buys and the national best
bid for sells.
(b) NB quoted depth is the NBO depth
for buys and NBB depth for sells.
(c) The indicator for quote leader is 1
if the receiving market was the first
market to post the NBB for a sell or NBO
for a buy.
3. Average execution price is a shareweighted average that includes only
executions on the receiving market.
Routed average execution price is a
share-weighted average that includes
only shares routed away from the
receiving market.
4. Routed shares refers to the number
of shares in the order that were routed
to another exchange or market.
5. The indicator for special handling
instructions should identify orders that
contain instructions that could result in
delayed execution or an execution price
other than the quote.
[FR Doc. 2014–15205 Filed 6–27–14; 8:45 am]
[Release No. 34–72452; File No. SR–ISE–
2014–23]
mstockstill on DSK4VPTVN1PROD with NOTICES
U.S.C. 78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
4 Amendment No. 1 was filed on April 29, 2014
and withdrawn on May 1, 2014.
5 See Securities Exchange Act Release No. 72098
(May 6, 2014), 79 FR 27006 (‘‘Notice’’).
6 See Supplementary Material .02 to Rule 504;
Supplementary Material .01 to Rule 2009.
7 See Supplementary Material .12 to Rule 504;
Supplementary Material .05 to Rule 2009.
Specifically, the Exchange may list short term
options in $0.50 intervals for strike prices less than
$75, or for option classes that trade in one dollar
increments in the related non-short term option, $1
intervals for strike prices that are between $75 and
$150, and $2.50 intervals for strike prices above
$150. See id.
8 See Rule 504(d). In general, the Exchange must
list standard expiration contracts in $2.50 intervals
for strike prices of $25 or less, $5 intervals for strike
prices greater than $25, and $10 intervals for strike
prices greater than $200. See id.
9 See Supplementary Material .02(e) to Rule 504;
Supplementary Material .01(e) to Rule 2009.
2 15
SECURITIES AND EXCHANGE
COMMISSION
Self-Regulatory Organizations;
International Securities Exchange,
LLC; Order Granting Approval of
Proposed Rule Change, as Modified by
Amendment No. 2, Regarding the
Short-Term Option Series Program
June 24, 2014.
I. Introduction
On April 22, 2014, the International
Securities Exchange, LLC (the
‘‘Exchange’’ or ‘‘ISE’’) filed with the
19:01 Jun 27, 2014
II. Description of the Proposed Rule
Change
On any Thursday or Friday that is a
business day, the Exchange currently
may list short term options that expire
at the close of business on each of the
next five Fridays that are business days
and are not Fridays in which monthly
or quarterly options expire.6 These short
term options may be listed in strike
price intervals of $0.50, $1, or $2.50.7
The Exchange may also list standard
expiration contracts, which are listed in
accordance with the regular monthly
expiration cycle, in wider strike price
intervals of $2.50, $5, or $10.8 During
the week prior to expiration only, the
Exchange is permitted to list related
non-short term option contracts in the
narrower strike price intervals available
for short term option series.9 Since this
exception to the standard strike price
1 15
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VerDate Mar<15>2010
Securities and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) 1 of the Securities Exchange Act
of 1934 (‘‘Act’’),2 and Rule 19b–4
thereunder,3 a proposed rule change to
amend its rules governing the Short
Term Option Series Program to
introduce finer strike price intervals for
standard expiration contracts in option
classes that also have short term options
listed on them (‘‘related non-short term
options’’), and to remove obsolete rule
text concerning the listing of new short
term option series during the week of
expiration. On May 1, 2014, the
Exchange filed Amendment No. 2 to the
proposal.4 The proposed rule change, as
modified by Amendment No. 2, was
published for comment in the Federal
Register on May 12, 2014.5 The
Commission received no comments on
the proposal. This order approves the
proposed rule change, as modified by
Amendment No. 2.
Jkt 232001
PO 00000
Frm 00130
Fmt 4703
Sfmt 4703
intervals is available only during the
week prior to expiration, however,
standard expiration contracts regularly
trade at significantly wider intervals
than their weekly counterparts.10 As a
result, the Exchange proposes to amend
Supplementary Material .02(e) to Rule
504 and Supplementary Material .01(e)
to Rule 2009 to permit the listing of
related non-short term options in the
same strike price intervals as allowed
for short term option series at any time
during the month prior to expiration,
which begins on the first trading day
after the prior month’s expiration date,
subject to the provisions of Rule
504(f).11
In addition, the Exchange noted that
it recently adopted rule text that states
that, notwithstanding any language to
the contrary, short term options may be
added up to and including on the
expiration date.12 Accordingly, the
Exchange proposes to delete rule text
that prohibits the opening of additional
series listed pursuant to Supplementary
Material .12 to Rule 504 and
Supplementary Material .05 to Rule
2009 during the week of expiration.13
The Exchange also stated that is has
analyzed its capacity, and represented
that it and the Options Price Reporting
Authority (‘‘OPRA’’) have the necessary
systems capacity to handle any potential
additional traffic associated with this
proposed rule change.14 In addition, the
Exchange stated that it believes that its
members will not have a capacity issue
as a result of this proposal.15
Furthermore, the Exchange stated that it
does not believe the proposed rule
change will cause fragmentation of
liquidity.16
III. Discussion and Commission
Findings
After careful review, the Commission
finds that the proposed rule change is
consistent with the requirements of the
Act and the rules and regulations
thereunder applicable to a national
securities exchange.17 In particular, the
Commission finds that the proposed
10 See
Notice, supra note 5, at 27007.
example, since the April 2014 monthly
option expired on Saturday, April 19, the proposed
rule change would allow the Exchange to list the
May 2014 monthly option in short term option
intervals starting Monday, April 21. See Notice,
supra note 5, at 27007.
12 See Securities Exchange Act Release No. 71033
(December 11, 2013), 78 FR 76375 (December 17,
2013) (SR–ISE–2013–68).
13 See Notice, supra note 5, at 27007.
14 See Notice, supra note 5, at 27008.
15 Id.
16 Id.
17 In approving the proposed rule change, the
Commission has considered its impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
11 For
E:\FR\FM\30JNN1.SGM
30JNN1
mstockstill on DSK4VPTVN1PROD with NOTICES
Federal Register / Vol. 79, No. 125 / Monday, June 30, 2014 / Notices
rule change is consistent with Section
6(b)(5) of the Act,18 which requires,
among other things, that the rules of a
national securities exchange be
designed to promote just and equitable
principles of trade, to prevent
fraudulent and manipulative acts, to
remove impediments to and perfect the
mechanism of a free and open market
and a national market system, and, in
general, to protect investors and the
public interest.
The Commission believes that the
proposed change may provide the
investing public and other market
participants more flexibility to closely
tailor their investment and hedging
decisions, thus allowing them to better
manage their risk exposure. As the
Exchange notes, standard expiration
contracts currently trade in wider strike
price intervals than their weekly
counterparts, except during the week
prior to expiration.19 The Exchange
further states that this creates a situation
where contracts on the same option
class that expire both several weeks
before and several weeks after the
standard expiration are eligible to trade
in strike price intervals that the
standard expiration contract is not.20
According to the Exchange, the
proposed rule change will increase
market efficiency by harmonizing strike
price intervals for contracts that are
close to expiration, whether those
contracts are listed pursuant to weekly
or monthly expiration cycles.21
The Commission believes that the
proposed rule change to remove
obsolete rule next concerning the listing
of new short term option during the
week of expiration is consistent with the
Act because it protects investors and the
public interest by eliminating any
confusion about the opening of
additional series during the week of
expiration.
Finally, in approving this proposal,
the Commission notes that the Exchange
has represented that it and OPRA have
the necessary systems capacity to
handle the potential additional traffic
associated with this proposed rule
change.22 The Exchange further stated
that it believes its members will not
have a capacity issue as a result of the
proposal and that it does not believe
this expansion will cause fragmentation
of liquidity. 23
IV. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act 24 that the
proposed rule change (SR–ISE–2014–
23), as modified by Amendment No. 2,
be, and hereby is, approved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.25
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–15199 Filed 6–27–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–72458; File No. SR–
NYSEArca–2014–56]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Designation of a
Longer Period for Commission Action
on Proposed Rule Change Relating to
the Listing and Trading of Shares of
the PIMCO Income Exchange-Traded
Fund Under NYSE Arca Equities Rule
8.600
June 24, 2014.
On May 1, 2014, NYSE Arca, Inc. filed
with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule
change relating to the listing and trading
of shares of the PIMCO Income
Exchange-Traded Fund. The proposed
rule change was published for comment
in the Federal Register on May 21,
2014.3 The Commission received no
comment letters on the proposed rule
change.
Section 19(b)(2) of the Act 4 provides
that, within 45 days of the publication
of notice of the filing of a proposed rule
change, or within such longer period up
to 90 days as the Commission may
designate if it finds such longer period
to be appropriate and publishes its
reasons for so finding or as to which the
self-regulatory organization consents,
the Commission shall either approve the
proposed rule change, disapprove the
proposed rule change, or institute
proceedings to determine whether the
proposed rule change should be
disapproved. The Commission is
extending this 45-day time period. The
Commission finds that it is appropriate
U.S.C. 78f(b)(5).
19 See Notice, supra note 5, at 27007.
20 See Notice, supra note 5, at 27007–8.
21 See Notice, supra note 5, at 27008.
22 Id.
23 Id.
VerDate Mar<15>2010
19:01 Jun 27, 2014
Jkt 232001
U.S.C. 78f(b)(2).
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 72170
(May 15, 2014), 79 FR 29231.
4 15 U.S.C. 78s(b)(2).
to designate a longer period within
which to take action on the proposed
rule change so that it has sufficient time
to consider the proposed rule change.
Accordingly, the Commission,
pursuant to Section 19(b)(2) of the Act,5
designates August 19, 2014, as the date
by which the Commission should either
approve or disapprove or institute
proceedings to determine whether to
disapprove the proposed rule change
(File Number SR–NYSEArca–2014–56).
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.6
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–15206 Filed 6–27–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–72455; File No. SR–ISE–
2014–09]
Self-Regulatory Organizations;
International Securities Exchange,
LLC; Order Instituting Proceedings to
Determine Whether to Approve or
Disapprove Proposed Rule Change
Relating to Market Maker Risk
Parameters
June 24, 2014.
I. Introduction
On March 10, 2014, the International
Securities Exchange, LLC (‘‘Exchange’’
or ‘‘ISE’’) filed with the Securities and
Exchange Commission (‘‘Commission’’),
pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a
proposed rule change to amend ISE
Rules 722 and 804 to mitigate market
maker risk by adopting an Exchangeprovided risk management
functionality. The proposed rule change
was published for comment in the
Federal Register on March 26, 2014.3
The Commission received no comments
on the proposal. On May 7, 2014,
pursuant to Section 19(b)(2) of the Act,4
the Commission designated a longer
period within which to either approve
the proposed rule change, disapprove
the proposed rule change, or institute
proceedings to determine whether to
24 15
18 15
36849
5 Id.
25 17
6 17
PO 00000
Frm 00131
Fmt 4703
Sfmt 4703
CFR 200.30–3(a)(31).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 71759
(Mar. 20, 2014), 79 FR 16850 (‘‘Notice’’).
4 15 U.S.C. 78s(b)(2).
1 15
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]]>Agencies
[Federal Register Volume 79, Number 125 (Monday, June 30, 2014)]
[Notices]
[Pages 36848-36849]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-15199]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-72452; File No. SR-ISE-2014-23]
Self-Regulatory Organizations; International Securities Exchange,
LLC; Order Granting Approval of Proposed Rule Change, as Modified by
Amendment No. 2, Regarding the Short-Term Option Series Program
June 24, 2014.
I. Introduction
On April 22, 2014, the International Securities Exchange, LLC (the
``Exchange'' or ``ISE'') filed with the Securities and Exchange
Commission (``Commission''), pursuant to Section 19(b)(1) \1\ of the
Securities Exchange Act of 1934 (``Act''),\2\ and Rule 19b-4
thereunder,\3\ a proposed rule change to amend its rules governing the
Short Term Option Series Program to introduce finer strike price
intervals for standard expiration contracts in option classes that also
have short term options listed on them (``related non-short term
options''), and to remove obsolete rule text concerning the listing of
new short term option series during the week of expiration. On May 1,
2014, the Exchange filed Amendment No. 2 to the proposal.\4\ The
proposed rule change, as modified by Amendment No. 2, was published for
comment in the Federal Register on May 12, 2014.\5\ The Commission
received no comments on the proposal. This order approves the proposed
rule change, as modified by Amendment No. 2.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
\4\ Amendment No. 1 was filed on April 29, 2014 and withdrawn on
May 1, 2014.
\5\ See Securities Exchange Act Release No. 72098 (May 6, 2014),
79 FR 27006 (``Notice'').
---------------------------------------------------------------------------
II. Description of the Proposed Rule Change
On any Thursday or Friday that is a business day, the Exchange
currently may list short term options that expire at the close of
business on each of the next five Fridays that are business days and
are not Fridays in which monthly or quarterly options expire.\6\ These
short term options may be listed in strike price intervals of $0.50,
$1, or $2.50.\7\ The Exchange may also list standard expiration
contracts, which are listed in accordance with the regular monthly
expiration cycle, in wider strike price intervals of $2.50, $5, or
$10.\8\ During the week prior to expiration only, the Exchange is
permitted to list related non-short term option contracts in the
narrower strike price intervals available for short term option
series.\9\ Since this exception to the standard strike price intervals
is available only during the week prior to expiration, however,
standard expiration contracts regularly trade at significantly wider
intervals than their weekly counterparts.\10\ As a result, the Exchange
proposes to amend Supplementary Material .02(e) to Rule 504 and
Supplementary Material .01(e) to Rule 2009 to permit the listing of
related non-short term options in the same strike price intervals as
allowed for short term option series at any time during the month prior
to expiration, which begins on the first trading day after the prior
month's expiration date, subject to the provisions of Rule 504(f).\11\
---------------------------------------------------------------------------
\6\ See Supplementary Material .02 to Rule 504; Supplementary
Material .01 to Rule 2009.
\7\ See Supplementary Material .12 to Rule 504; Supplementary
Material .05 to Rule 2009. Specifically, the Exchange may list short
term options in $0.50 intervals for strike prices less than $75, or
for option classes that trade in one dollar increments in the
related non-short term option, $1 intervals for strike prices that
are between $75 and $150, and $2.50 intervals for strike prices
above $150. See id.
\8\ See Rule 504(d). In general, the Exchange must list standard
expiration contracts in $2.50 intervals for strike prices of $25 or
less, $5 intervals for strike prices greater than $25, and $10
intervals for strike prices greater than $200. See id.
\9\ See Supplementary Material .02(e) to Rule 504; Supplementary
Material .01(e) to Rule 2009.
\10\ See Notice, supra note 5, at 27007.
\11\ For example, since the April 2014 monthly option expired on
Saturday, April 19, the proposed rule change would allow the
Exchange to list the May 2014 monthly option in short term option
intervals starting Monday, April 21. See Notice, supra note 5, at
27007.
---------------------------------------------------------------------------
In addition, the Exchange noted that it recently adopted rule text
that states that, notwithstanding any language to the contrary, short
term options may be added up to and including on the expiration
date.\12\ Accordingly, the Exchange proposes to delete rule text that
prohibits the opening of additional series listed pursuant to
Supplementary Material .12 to Rule 504 and Supplementary Material .05
to Rule 2009 during the week of expiration.\13\
---------------------------------------------------------------------------
\12\ See Securities Exchange Act Release No. 71033 (December 11,
2013), 78 FR 76375 (December 17, 2013) (SR-ISE-2013-68).
\13\ See Notice, supra note 5, at 27007.
---------------------------------------------------------------------------
The Exchange also stated that is has analyzed its capacity, and
represented that it and the Options Price Reporting Authority
(``OPRA'') have the necessary systems capacity to handle any potential
additional traffic associated with this proposed rule change.\14\ In
addition, the Exchange stated that it believes that its members will
not have a capacity issue as a result of this proposal.\15\
Furthermore, the Exchange stated that it does not believe the proposed
rule change will cause fragmentation of liquidity.\16\
---------------------------------------------------------------------------
\14\ See Notice, supra note 5, at 27008.
\15\ Id.
\16\ Id.
---------------------------------------------------------------------------
III. Discussion and Commission Findings
After careful review, the Commission finds that the proposed rule
change is consistent with the requirements of the Act and the rules and
regulations thereunder applicable to a national securities
exchange.\17\ In particular, the Commission finds that the proposed
[[Page 36849]]
rule change is consistent with Section 6(b)(5) of the Act,\18\ which
requires, among other things, that the rules of a national securities
exchange be designed to promote just and equitable principles of trade,
to prevent fraudulent and manipulative acts, to remove impediments to
and perfect the mechanism of a free and open market and a national
market system, and, in general, to protect investors and the public
interest.
---------------------------------------------------------------------------
\17\ In approving the proposed rule change, the Commission has
considered its impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
\18\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The Commission believes that the proposed change may provide the
investing public and other market participants more flexibility to
closely tailor their investment and hedging decisions, thus allowing
them to better manage their risk exposure. As the Exchange notes,
standard expiration contracts currently trade in wider strike price
intervals than their weekly counterparts, except during the week prior
to expiration.\19\ The Exchange further states that this creates a
situation where contracts on the same option class that expire both
several weeks before and several weeks after the standard expiration
are eligible to trade in strike price intervals that the standard
expiration contract is not.\20\ According to the Exchange, the proposed
rule change will increase market efficiency by harmonizing strike price
intervals for contracts that are close to expiration, whether those
contracts are listed pursuant to weekly or monthly expiration
cycles.\21\
---------------------------------------------------------------------------
\19\ See Notice, supra note 5, at 27007.
\20\ See Notice, supra note 5, at 27007-8.
\21\ See Notice, supra note 5, at 27008.
---------------------------------------------------------------------------
The Commission believes that the proposed rule change to remove
obsolete rule next concerning the listing of new short term option
during the week of expiration is consistent with the Act because it
protects investors and the public interest by eliminating any confusion
about the opening of additional series during the week of expiration.
Finally, in approving this proposal, the Commission notes that the
Exchange has represented that it and OPRA have the necessary systems
capacity to handle the potential additional traffic associated with
this proposed rule change.\22\ The Exchange further stated that it
believes its members will not have a capacity issue as a result of the
proposal and that it does not believe this expansion will cause
fragmentation of liquidity. \23\
---------------------------------------------------------------------------
\22\ Id.
\23\ Id.
---------------------------------------------------------------------------
IV. Conclusion
It is therefore ordered, pursuant to Section 19(b)(2) of the Act
\24\ that the proposed rule change (SR-ISE-2014-23), as modified by
Amendment No. 2, be, and hereby is, approved.
---------------------------------------------------------------------------
\24\ 15 U.S.C. 78f(b)(2).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\25\
---------------------------------------------------------------------------
\25\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-15199 Filed 6-27-14; 8:45 am]
BILLING CODE 8011-01-P
